Abstract
Managers have to make decisions several times a day. The decision-making process can be defined as an essential activity realized by managers every day. Decisions can be implemented intuitively, or by using relevant decision-making methods. This depends on the nature of the decision, as well as the intensity of its possible future effects. The theory of decision-making can be defined as a relatively young discipline. It can be stated that decision-making is no longer an intuitive process. Most decision-making situations are of a multiple criteria character. In this contribution, the authors focus on multiple-criteria decision-making, to which several methods can be applied. In the practical part, the authors use Saaty's method, also known as the Analytic Hierarchy Process. Saaty is considered to be the most important researcher dealing with the issue of multiple-criteria decision-making. The set multiple-criteria decision-making problem was to choose one business partner out of eight under consideration. The decision-making criteria included selected financial indicators and non-financial criteria. The aim of the contribution is to use the Analytic Hierarchy Process to assess potential business partners and to select an optimal candidate.
Highlights
Decision-making is described as one of the most important activities performed by business managers, and is referred to as the core of management
The decision-making process can be defined as a set of activities that leads to the resolution of a decision-making problem that involves at least two meaningful alternatives, of which the selected one offers the best result with respect to the set goal, as well as the possibility of its implementation [1]
A multiple-criteria matrix containing a description of the MCDM problem was created
Summary
Decision-making is described as one of the most important activities performed by business managers, and is referred to as the core of management. The development of studies dealing with multiple-criteria decision-making accelerated during the 1980s and early 1990s. Liao and Wu [4] developed a comprehensive algorithm for multi-expert multiple-criteria decision-making problems, whereby quantitative and qualitative criteria in the form of benefits, costs or target types are considered. In another study, they focus on the integrated method for cognitive complex multi-expert multiple-criteria decision-making based on ELECTRE III with weighted Borda rule [5]. The different methods that can be used for determining criteria weights and for evaluating alternative solutions are presented in Figures 1 and 2. The classification was developed by the authors on the basis of published research [11,12]
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